CEO Insights

The True Determinants of Financial Success

Too many investors and their financial advisors are just trying to make as much money as possible, defining their life’s success in dollars. But more money doesn’t always lead to a better life, especially if you never enjoy what the money can do for you. Tyson Ray, Certified Financial Planner™ (CFP®), founding partner of FORM Wealth Advisors, believes a better life is a better definition of success.

“When I was 24-years-old, I thought my job was to help clients make more money. I was given a house account of a multi-million dollar, 94-year-old client. When I tried to review her accounts, she told me, ‘That! That, is black ink on white paper to me now!’ That was a multi-million-dollar portfolio, which her former advisor never encouraged her to spend; never asked her what she wanted to do with the money but just kept her focus on more money. For the rest of my career, I realized my job was not to help clients make money but rather to enjoy the best life they could afford.”

Ray believes that financial advisors must get to know their clients to properly advise them on how to utilize their money to achieve the life they want.

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Ray has long appreciated the topics of finance and economics, as well as the consequences of not having enough money. He started working at the age of 12 to help his family in the face of being evicted from their home. While in high school, a stockbroker did a presentation on investing in the stock market. At the age of 16, Ray followed up with the stockbroker and became a client investing $100 per month.

tyson sitiing200x300After graduating from the University of West Florida with degrees in business, psychology, and political science, Ray decided to pursue a career as a financial advisor. At the age of 22, he partnered with Dick Honeyager, who had more than 40 years of financial advisory experience. When Dick retired four years later, Ray took over the business, and in 2005 entered a new partnership with Luke Kuchenberg, CFP® to found FORM Wealth Advisors based in Lake Geneva, Wisconsin.

“Our ideal clients have saved for most of their lives, and they want help to live the lives they want without the fear of making costly mistakes,” said Ray. “If a client’s goal is just to make more money, then we’re not going to be a good fit.”

Their unique planning exercise is a significant part of the process of getting to know their client’s desires and concerns. Many clients have not sat down with a financial planner to lay out their future or had a frank discussion about what kind of retirement they can afford, let alone the legacy they may wish to leave behind.

FORM Wealth Advisors works with clients to understand their current lifestyles, and then helps them recognize what their planning and investment assets can do for them in the future. The company spends time up front, and throughout the relationship, helping clients articulate what they want to do with their money.

“As investments go, we believe that slow and steady wins the race, and you will be rewarded for your patience,” said Ray. “I was told investments are like a bar of soap, the more you handle them the smaller they get. We are paid to help the clients not change their market exposure.”

The industry believes client investments should only be customized to the risk they want take. However, Ray believes clients cannot articulate what is “too much risk” until they’ve gone past that level of risk. Given the various financial crises and flash crashes, Ray finds many investors have now become too conservative for what they want to achieve with their investments.

To address these issues, FORM Wealth Advisors created two equity-focused investment models that adhere to an investment strategy based on long-term growth for its clients. By standardizing investment models for all clients, the company can customize each client’s cash position based on how much money they’ll need over the following 12 to 24 months rather than customize each portfolio.

tyson standing200x300“Prior to 2007, we had too many customized client investment plans, which became difficult to properly manage on a day-to-day basis,” said Ray. “We now have hundreds of families invested in our long-term, equity-focused models. By monitoring the models, we can monitor all clients’ accounts at once and provide all clients a similar experience.”

Some investors have turned to technology, such as robo-advisors and other apps, to help them invest their funds. While these tools can possibly help to make investments “easier” and “more efficient,” they cannot protect an investor from making poor emotional decisions, even when the application indicates otherwise. That’s why working with a financial advisor who knows a client’s personality, tendencies and emotions can be invaluable to help ensure clients have the money they need when they need it.

“We use technology to help monitor things, but it does not enhance the client relationships,” said Ray. “We continue to have engaged face-to-face meetings with clients. We care to proactively check in on clients and see how they are enjoying life. We don’t believe technology will ever be able to replace a personal human relationship.”

For more information on FORM Wealth Advisors, visit: formwealth.com

Opinions expressed in this article are those of the author and are not necessarily those of Raymond James. All opinions are as of this date and are subject to change without notice. Raymond James is not affiliated with Advisors Magazine or David Gargaro.

FORM Wealth is independent of Raymond James Financial Services and is not a registered broker/dealer. Securities offered through Raymond James Financial Services, Inc. Member FINRA/SIPC. Investment advisory services offered through Raymond James Financial Services Advisors, Inc.

 

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